US suspends issuing foreign aid grants: How it affects Ukraine

According to a document obtained by the edition, Rubio's directive was issued to all diplomatic and consular missions. It takes effect immediately and requires State Department staff to issue stop-work orders on nearly all existing foreign aid grants.

The report noted that this move appears to go further than a recent executive order by President Donald Trump, which instructed the department to pause foreign aid grants for 90 days pending a review by the secretary of state. However, Trump's order left unclear whether it would affect already allocated funds or assistance to Ukraine.

According to three current and two former government officials familiar with the new instructions, no further actions will be taken to disperse funds already allocated for programs approved by the US government.

Shocking order

The order has shocked some State Department officials with its broad scope. "State just totally went nuclear on foreign assistance," one State Department official said.

A source familiar with congressional discussions stated that Trump’s directive is unlawful.

"Freezing these international investments will lead our international partners to seek other funding partners - likely U.S. competitors and adversaries - to fill this hole and displace the United States' influence the longer this unlawful impoundment continues," the source said, speaking anonymously.

A former senior official at the US Agency for International Development (USAID), also speaking anonymously, warned that organizations would have to halt all operations.

"Organizations will have to stop all activities, so all lifesaving health services, HIV/AIDS, nutrition, maternal and child health, all agriculture work, all support of civil society organizations, education," the official said.

Exceptions, interpretations, and aid to Ukraine

At the same time, Politico notes that the document leaves room for interpretation and outlines certain exceptions.

It specifies that foreign military financing for Egypt and Israel will continue, as will emergency food aid and legitimate expenses incurred prior to the date of this guidance under existing awards. At points, it also says the decisions need to be consistent with the terms of the relevant award.

One current State Department official and two former Biden administration officials, speaking anonymously, said the pause appears likely to halt assistance to key allies, including Ukraine, Jordan, and Taiwan.

According to current and former officials, Rubio's directive could expose the US government to civil liability, as lawsuits may arise over unfulfilled contracts if it is determined that their terms were breached. While the directive occasionally mentions that decisions should be aligned with the terms of the respective contract, the risk remains significant.

The instructions state that decisions whether to continue, modify or terminate programs will be made following the review by the Secretary of State.

The guidelines were approved by several senior State Department officials, including State Department Counselor Michael Needham and Director of Policy Planning Michael Anton.

The State Department is expected to prepare a report within 85 days of the directive's issuance. This report will accompany Rubio's recommendation to President Trump on which foreign aid programs should continue and which should be terminated.

At the same time, Rubio has granted an exception for emergency food assistance, according to the memorandum. This comes amid a surge in humanitarian aid to Gaza following the January 19 ceasefire between Israel and Hamas militants, as well as several other hunger crises worldwide, including in Sudan.

The suspension of financial aid to Ukraine has raised particular concern among US officials, who are eager to support the country in its fight against Russia.

Meanwhile, Voice of America correspondent Ostap Yarysh shared on social media platform X that the Pentagon denied any suspension of military support for Ukraine.

"I’m not sure what POLITICO means. I suspect it might refer to the FMF program, but the funds allocated for Ukraine’s support have long been spent," he wrote.

Trump suspends aid to other countries

Donald Trump and fellow Republicans have long criticized what they describe as wasteful spending on foreign aid during the administrations of Barack Obama and Joe Biden.

However, in recent days, Trump has intensified his rhetoric toward Russia, threatening Moscow with sanctions if it does not end its nearly three-year invasion of Ukraine. He also stated that it is Putin’s responsibility to bring the war to an end.

On January 21, Trump signed an executive order suspending all foreign aid programs for 90 days. The programs will undergo a review to assess their alignment with the country’s political objectives.

Read more about the provisions of the US president’s order and its potential impact on Ukraine in our in-depth article.